EYIS is a domestic corporation engaged in the production, distribution and sale of

air compressors and other industrial tools and equipment.

Respondent Shen Dar is a Taiwan-based foreign corporation engaged in the
manufacture of air compressors
From 1997 to 2004, EYIS imported air compressors from Shen Dar through sales
contracts.
In the corresponding Bill of Ladings, the items were described merely as air
compressors.[9] There is no documentary evidence to show that such air
compressors were marked VESPA.
On June 9, 1997, Shen Dar filed Trademark Application with the IPO for the mark
VESPA, Chinese Characters and Device for use on air compressors and welding
machines.
On July 28, 1999, EYIS filed Trademark Application also for the mark VESPA, for use
on air compressors. On January 18, 2004, the IPO issued COR in favor of EYIS.
Thereafter, on February 8, 2007, Shen Dar was also issued COR.
Shen Dar filed a Petition for Cancellation of EYIS COR with the BLA. Shen Dar alleged
that EYIS was a mere distributor of air compressors bearing the mark VESPA which it
imported from Shen Dar. Shen Dar also argued that it had prior and exclusive right
to the use and registration of the mark VESPA in the Philippines under the provisions
of the Paris Convention.
EYIS denied the claim of Shen Dar to be the true owners of the mark VESPA being
the sole assembler and fabricator of air compressors since the early 1990s. They
further alleged that the air compressors that Shen Dar allegedly supplied them bore
the mark SD for Shen Dar and not VESPA. Moreover, EYIS argued that Shen Dar, not
being the owner of the mark, could not seek protection from the provisions of the
Paris Convention or the IP Code.
Issue:
Whether EYIS is the true owner of the mark VESPA
HELD:
EYIS owns the VESPA trademark; it has prior use.
Ownership of a mark or trade name may be acquired not necessarily by registration
but by adoption and use in trade or commerce. As between actual use of a mark
without registration, and registration of the mark without actual use thereof, the
former prevails over the latter. As a rule, actual use in commerce or business is a
pre-requisite to the acquisition of the right of ownership.
Under Section 123.1 of IPO provision, the registration of a mark is prevented with
the filing of an earlier application for registration. This must not, however, be
interpreted to mean that ownership should be based upon an earlier filing date.
While RA 8293 (IPC) removed the previous requirement of proof of actual use prior

to the filing of an application for registration of a mark, proof of prior and continuous
use is necessary to establish ownership of a mark. Such ownership constitutes
sufficient evidence to oppose the registration of a mark.